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Big Oil skeptical of Trump’s Venezuela push without big changes
WASHINGTON ― Some of America’s top oil executives told President Donald Trump their companies aren’t ready to invest in oil operations in Venezuela unless major changes are made to ensure the viability of the ventures.
The oil industry pointed to challenges with Trump’s Venezuela oil plan as the president met with executives from 17 oil companies on Jan. 9, nearly one week after the United States military captured the country’s president, Nicolás Maduro.
“We first got into Venezuela in the 1940s. We’ve had our assets seized twice,” ExxonMobil CEO Darren Woods said. “So you can imagine, to re-enter a third time would require some pretty significant changes from what we’ve seen historically here and what is currently the state.”
More: Trump meets with oil execs after Venezuela attack. Here’s why.
Trump has said the United States will take control of between 30 billion and 50 billion barrels of Venezuela oil and is working to convince American oil companies to spend billions to upgrade aging oil infrastructure to increase the country’s energy output. He has said the companies will more than earn their money back through profits, with oil sold to both Americans and Venezuelans.
But Woods said existing legal and commercial challenges make the country’s oil “uninvestable” unless changes are made for legal, financial and security guarantees. “There has to be durable investment protections and there has to be a change to the hydrocarbon laws in the country.”
More: Trump says Venezuela will give up to 50 million barrels of oil to US
If the Trump administration is able to address those needs, ExxonMobil can “hit the ground” quickly, Woods said. He said the company plans to assemble a technical team to assess the state of the oil industry in Venezuela. “We haven’t been in the country in almost 20 years,” he said.
Trump said he hopes to strike a deal with the oil companies that would include security guarantees to keep the companies “physically safe, in addition to financially safe.”
“I have an idea what I want, what I think we should have,” Trump said of a potential deal. “We have to get them to invest, and then we have to get their money back as quickly as we can. And then we can divvy it all up between Venezuela, the United States and them. I think it’s simple. I think the formula is simple. We start with a brand-new plate.”
Vice President JD Vance, Secretary of State Marco Rubio, Energy Secretary Chris Wright and Interior Secretary Doug Burgum joined Trump and the oil executives at the meeting.
More: Trump reveals how long he expects US to control Venezuelan oil
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“Certainly it excites me as an explorationist,” Harold Hamm, chairman and CEO of Continental Resources, told Trump of the possibility of investing in Venezuelan oil. “Everybody has that in their blood. It is a very exciting country, and a lot of reserves. It’s got its challenges, and the industry knows how to handle that.”
“As Darren said,” Hamm added, referring to the ExxonMobil CEO, “you go in with your eyes open and do the best you can with the team you got.”
The most bullish oil company about the opportunities in Venezuela was Chevron, the only U.S. company currently operating in Venezuela, with 3,000 employees in the country.
Mark Nelson, vice chairman of Chevron, said the company’s oil production in Venezuela over the past five to seven years has increased 40,000 barrels a day to 240,000 barrels.
“I think we have a path forward here very shortly to be able to increase our liftings from those joint ventures 100%, essentially, effective immediately,” Nelson said.
He said having Chevron workers already on the ground is a “definite advantage.”
Ryan Lance, chairman and CEO of ConocoPhillips, said talks need to take place with banks to restructure debt for oil companies that invest billions into energy infrastructure. He singled out the EXIM Bank, the official export creditor of the federal government.
“If we can do that, and think bold, there’s an opportunity to be quick, fast and restore quality of what’s been lost in Venezuela over the course of the last 25 years.”
At least one alternative energy expert also said Venezuela would be a tough sell to oil executives.
The oil companies “would need all kinds of guarantees in order to make the math investment work,” said Jesse Lee, senior advisor at Climate Power and a former senior advisor to the National Economic Council during the Biden administration. Climate Power is an advocacy group for clean energy and climate action in the U.S.
“I don’t see the circumstances under which any industry is going to pour a hundred billion dollars into a country where for all they know some war is going to break out any day,” Lee said. Contributing: Dinah Voyles Pulver
Reach Joey Garrison on X @joeygarrison.
This article originally appeared on USA TODAY: Big Oil says big changes needed for Trump’s Venezuela push to work